But B.C. activity will be up 7%

Canwest News ServiceJanuary 29, 2009

Oil and gas drilling in Western Canada will plummet in 2009 as the oilpatch swings from boom to bust, according to an industry association forecast.

The Petroleum Service Association of Canada predicted the number of wells drilled in the region will drop 21 per cent this year from last season to 13,500 wells due to an economic slowdown more severe than originally predicted.

And Alberta will feel the crunch the most, seeing drilling activity fall by more than a quarter this year, the association said.

"Since the initial release of our forecast in November, the world's rapid decline into recession has reduced demand for all commodities, including oil and gas," Roger Soucy, PSAC president said.

"This has triggered a dramatic deterioration in prices, leading to a significant reduction in related field activity in Canada."

The decrease adds up to a full 46 per cent from a peak of 25,000 wells drilled in 2005 at the peak of an oilpatch frenzy to cash in on rising commodity prices.

Oil and gas prices have since crashed by about 70 per cent from record highs in 2008, leading to billions of dollars in spending cuts by producers.

On a provincial basis, the association predicts 8,455 wells to be drilled in Alberta, a 27 per cent slide from last year.

British Columbia will see a seven per cent increase in activity, while Saskatchewan will drop by almost five per cent and Manitoba by 13 per cent.

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